WALSH OBTAINS THREE SUBPOENAS FOR ISRAELIS IN IRAN-CONTRA PROBE

By George Lardner Jr.June 6, 1987

A federal grand jury investigating the Iran-contra affair under independent counsel Lawrence E. Walsh has issued subpoenas for two Israeli arms dealers and a former adviser to Israel's prime minister to testify about the origins of the administration's secret arms shipments to Iran, sources said yesterday.

One of the subpoenas was served in Tel Aviv this week on Al Schwimmer, 69, American-born managing director of Israel Aircraft Industries who holds dual Israeli-U.S. citizenship.

The other two subpoenas, Glenn Frankel of The Washington Post Foreign Service reported from Jerusalem, were directed at Amiram Nir, an adviser on counterterrorism to Israeli Prime Ministers Shimon Peres and later Yitzhak Shamir, and Yaacov Nimrodi, another Israeli arms dealer and former agent for the Mossad, Israel's intelligence agency. Nir and Nimrodi are Israeli citizens, and sources here said the subpoenas for them cannot be served unless they set foot in the United States. The subpoenas triggered angry protests from the Israeli government, whose officials said they expected "the American administration" to pressure Walsh into withdrawing the court orders.

Senior Israeli officials, Frankel reported, added that Israel was delaying its responses to written questions posed by the Senate and House Iran-contra committees until the dispute over the independent counsel's subpoenas is resolved.

Citing what he called "technical reasons" for the delay, one official said, "that means we cannot move forward and supply information when there have been changes by the other side in our previous agreement. We thought we had a full understanding and we believe it is now up to the American administration to influence the special prosecutor to withdraw the subpoenas."

Walsh had no comment. He has said that he was not a party to the Israeli agreement with the congressional committees and was not bound by it.

Walsh had been seeking to find a way, through the State Department, to question the Israelis directly, but these negotiations evidently foundered weeks ago. Last month, the special prosecutor had a subpoena served on David Kimche, the former director general of the Israeli Foreign Ministry who played an active role in launching the sales of U.S. arms to Iran, while Kimche was on a visit to New York.

The Israeli government, with the apparent backing of the State Department, responded to that action by going to court and obtaining a stay of Kimche's subpoena while Chief U.S. District Court Judge Aubrey E. Robinson ponders the legal issues.

Schwimmer and Nimrodi were involved in the arms sales during 1985. At least three shipments that year led to the release of only one U.S. hostage, and there was reportedly unhappiness with their performance in Washington and Jerusalem. Nir, a former paratrooper, emerged in 1986 as the Israeli counterpart of former National Security Council aide Marine Lt. Col. Oliver L. North.

Schwimmer, a friend of Israeli Foreign Minister Shimon Peres, was presented with his subpoena by a U.S. consular official under a federal law permitting service on U.S. nationals abroad if a U.S. court finds "that it is not possible to obtain his testimony in admissible form without his personal appearance or to obtain the production" of necessary documents in any other way.

Israel radio reported that Schwimmer had been told to appear within 10 days but added that the government might forbid him to travel to the United States or instruct him to reveal no information to Walsh's investigators. Schwimmer, a flight engineer from California who moved to Israel around 1950, was quoted as saying that he would do "whatever the Israeli government instructs me to do."

Schwimmer could face the seizure of any U.S. assets he might have if he fails to comply with the Walsh subpoena.

Israeli Foreign Ministry spokesman Ehud Gol said Israel objected to the subpoenas for all four witnesses. "We still insist that the while matter should be handled on a government-to-government basis as agreed to between Israel and the congressional investigating committees," he said.

In Washington, Israeli Embassy spokesman Yossi Gal added, "Each and every one of these individuals was acting on behalf of the government of Israel and everything they were doing, they were doing because the government asked them to do it. We don't think individual subpoenas should be issued."

At the same time, sources said, the Israeli government's long-promised report, including written responses to interrogatories posed to the four principals, is "not ready yet" and now may be delayed for the duration of the dispute. Gol, however, said that "we have every intention of cooperating with the congressional committees."

Israel did complete a "financial chronology" on the arms sales in late April. Lawyers from both the congressional committees and from Walsh's office were allowed to inspect it and make notes, but they were not provided with copies.Staff writers Charles R. Babcock and Mary Thornton contributed to this report.